The city is a source of inspiration to artists living in the city – and factors such as affordable living and studio space contribute to a tight- knit creative community, according to a new report commissioned by the University of Sheffield.

A Snapshot of the Visual Arts Scene in Sheffield is based on reflections from 390 city-based artists, art studies professionals and arts organisations in the city and surrounding region.

The picture they paint is one of a tight community of artists, which is both very supportive of each other and which enjoys the support and interest of the wider community and city.

Sheffield’s proximity to the Peak District with its hills which allow ‘freedom of vision’ and trees which are ‘never out of sight’ – all available just a few miles from the heart of a major city – were highlighted as sources of inspiration.

It was also noted that Sheffield is an affordable place to be an artist and its central geographic location makes travel to other cities easy.

The report also showed that art contributes significantly to Sheffield’s vibrancy and economy, through major investments in space by organisations such as ROCO, The Art House and Site Gallery and a collective studio turnover of more than £1million each year.

In the Millennium Galleries, Sheffield can also boast the most-visited free attraction in the North of England, with twice the number of visitors as Yorkshire Sculpture Park near Barnsley and half as many again as The Baltic in Gateshead.

But many artists said despite being a great city in which to live, there is a lack of selling spaces, the cost of selling through galleries is considered high and there was a general lack of art-buyers in the region.

The report added: “Beyond the buildings, Sheffield is outpaced by other cities in terms of major art events.”

It said that despite many artists living and working in Sheffield, this is not reflected in the institutions and resources in the city.

But the report has come up with some creative solutions to bring more investment to Sheffield, including setting up a large street art festival to rival those in Birmingham and Bristol.

With home grown graffiti artists such as Kid Acne and Phlegm who have found worldwide fame, the city has more than enough talent to show off. Kid Acne’s Kill Your Darlings exhibition at Museums Sheffield in 2011 attracted more than 50,000 visitors and Phlegm’s market traders’ installation, Castle House, was a great success .

The report said: “We would like to see more communication between local government and the visual arts; wider, better and more experimental use of buildings before they are sold off and perhaps instead of being sold off; more help across the arts sector rather than just flagship projects; and most of all a reciprocity of the feeling that visual arts matter for the city in the same way that the city matters to visual artists.”

With more investment attracting more visitors, Sheffield could give creative capitals like Manchester and Bristol a run for their money.Sheffield artists have a great tradition of taking inspiration from the city, from Pete McKee’s illustrated Sheffield characters to Jonathan Wilkinson’s cityscapes.

Prof Vanessa Toulmin, director of city and cultural engagement at the University of Sheffield, said: “This report highlights the huge eclectic mix of artistic talent we have in the city and the potential we have to make Sheffield a destination venue for art.

“Artists have told us that they find Sheffield a huge source of inspiration; from its physical geography and sense of space, to its lack of pretension and ‘village’ feel.

“This is reflected in the art they produce, all of which contributes to making Sheffield a very special place.”